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LG's profit falls on TV demand, handset costs

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July 24, 2013 01:19 AM EST | AP

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SEOUL, South Korea — LG Electronics' latest quarterly report underlines challenges facing global electronics makers as weak TV demand and stiffer competition in smartphones undermine profit.

The results Wednesday showed an 8 percent decline in April-June net profit to 155.5 billion won ($140 million) even as LG's revenue rose 10 percent from a year earlier to 15.2 trillion won ($13.6 billion).

LG's TV sales improved and smartphone sales hit a quarterly high of 12.1 million handsets.

That was not enough to create bigger profits as consumers snapped up cheaper devices that have lower margins for manufacturers.

Soft TV demand combined with competition depressed TV prices.

LG's mobile unit is not a cash cow despite being the No. 5 smartphone supplier. Its cheaper smartphones are popular but also burden the company with heavy marketing costs.